CBDC consolidate the stablecoins, according to the ECB

A European Central Bank (ECB) report, published in September 2025, ensures that digital central banks (CBDC) currencies, such as the digital euro that is developing, can make STABLECINS as reliable as traditional money, preventing the financial system from fragmenting in the euro zone.

In the document entitled “Fungibility: the case of the stablecoins”, the ECB explains how the stablecoins, whose global value reached 250 billion dollars in June 2025 (equivalent to 1% of the money in circulation in the US), They can function as real money.

In it, analysts Charles-Enguerrand Cost and George Pantelopoulos explain that for the stablecoins to be accepted as banknotes or bank deposits, they must meet three requirements:

1. That the transactions are definitive,
2. That the systems where they operate are compatible,
3. That can easily become official money from the Central Bank.

The report emphasizes that the stablecoins backed by real assets, such as deposits or bonds, can achieve it, but algorithmic, which depend on automatic formulas, no. The financial issuer believes that without clear rules, Stable currencies could create a messy financial systemas happened with Terra Usd, an algorithmic stabloin that collapsed in 2022, as Cryptonoticia reported at the time.

In that sense, the ECB also details how stablecoins can be as reliable as a bank money if they meet three key conditions:

1. Definitive transactions: Payments must be closed without reversion, such as when paid in cash. The report states: “In Ethereum, the participation test achieves a deterministic purpose, while in Bitcoin, the work test offers a probabilistic purpose.” This means that Ethereum confirms payments more clearly and quickly, ensuring that the transaction is irreversible from the moment it is completed. In Bitcoin, on the other hand, certainty grows over time, since you have to wait for several confirmations, which can be less practical for immediate payments.
2. Compatible systems: Stablecoins must be integrated with traditional payment systems, such as those used in bank transfers or stores. The report highlights that connecting cryptocurrency networks with systems such as ECB target2 is crucial. But it is still a technical challenge due to different data formats. For example, banks use standards such as ISO 20022, while digital assets have their own formats.
3. Change to official money: The stablecoins must easily become euros of the ECB, which requires their emitters to have solid reserves. The report quotes that Tether, the largest emitter of Stablecoins, ensures that 85% of its reserves are effective or equivalent, although only 0.12% is real cash. Instead, algorithmic Stablingins, such as Terra Usd, are not reliable because “they have no real support to become official money.”

Dirk Bullmann, a crypto -active researcher at the ECB, agrees that “a digital euro can strengthen confidence in regulated stablecoun”, as noted in 2020 in The report of the digital asset working group of the financial institution. This suggests that a CBDC such as the digital euro, together with strict rules such as Mica (Markets in Crypto Assets) regulations of the European Union, can “maintain financial order by making Stablocoins more reliable.”

The G7 warned in 2019 that, without international rules, Stablecoins could destabilize the global financial system. In response to this, the United States approved the Genius Law (Law to guide and establish national innovation for the US stablecoins.) To regulate the market of stable currencies.

For its part, the European Central Bank, together with other European Union agencies, have been more focused on the development of a digital euro, however, the region regulated the stablecoins with the Mica regulation. This regulation requires, the emitters of stable currencies, solid reserves and robust governance, which, in the opinion of the ECB, aligns the stablecoins with the traditional financial system and facilitates their integration with a CBDC as the digital euro.

In short, the ECB believes that a digital euro can make The stablcoins backed up are as safe as traditional moneyavoiding a messy financial system. However, connecting cryptocurrencies with banks and guaranteeing solid reserves remains a challenge.

Therefore, the financial institution analysts are convinced that in the future, the digital euro could unite the best of both worlds, but the lack of global agreements and doubts about CBDC could stop progress, leaving space for more innovations or new risks.

However, lawyer Cristina Carrascosa criticizes the ECB approach by pointing out that “the digital euro is not up to the stablecoins technology and does not solve real needs.” As Cryptonotics reported yesterday, she believes that private stablcoins are more agile and could overcome CBDC if banks do not improve their systems.